NCDEX Chana under short covering; Resistance seen at 5321
Commodity Online | November 23 2020
UPDATED 12:10:38 IST

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NCDEX Chana under fresh buying; Support seen at 4413

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MCX Nickel likely to move in a range of 1327.5-1353.9

Technically Chana market is under short covering as market has witnessed drop in open interest by 2.74% to settled at 50770 while prices up 91 rupees.

Now NCDEX Chana is getting support at 5216 and below same could see a test of 5149 levels, and resistance is now likely to be seen at 5321, a move above could see prices testing 5359.

Chana yesterday settled up by 1.75% at 5282 as NAFED has now suspended sales of chana in the open market "till further notice".

Rally in chana prices has also been helped by the distribution of the pulse under the Pradhan Mantri Garib Kalyan Anna Yojana, under which 800 mln individual received 1 kg of free pulses every month till November.

This led to clearance of carryover stocks from the previous year's crop and as a result, overall stocks dwindled. Strong domestic demand for chana during the ongoing festival season has also supported prices.

The elevated prices would also attract farmers to add more area under the pulse during the upcoming rabi sowing, which has started in some growing regions. Members had earlier demanded the government reduce import duty on chana.

However, reports suggest that the government is not considering such a move as imports may harm the interests of farmers and lead to lower sowing.

With supply issues persisting and government likely to take measures with an eye on encouraging more sowing, the retail customer may be left paying more to consume basic food items like pulses.

Traders are keeping an eye on rejecting or approving tenders by Nafed to understand the direction of prices.

Trading Ideas:
--Chana trading range for the day is 5149-5359.
--Chana prices seen supported as NAFED has now suspended sales "till further notice".
--Rally in chana prices has also been helped by the distribution of the pulse under the Pradhan Mantri Garib Kalyan Anna Yojana
--Traders are keeping an eye on rejecting or approving tenders by Nafed to understand the direction of prices.
--In Delhi spot market, chana gained by 22.85 Rupees to end at 5100 Rupees per 100 kgs.

Courtesy: Kedia Commodities

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